Discuss the statistical evidence concerning the efficient markets hypothesis
The evidence indicates that stock prices may not follow a random walk exactly, but they are pretty close. The correlation between how well a stock does one year and how well it does the next is close to zero. Indexed funds tend to perform better than most managed funds. However, there is some evidence that people may become overconfident in their abilities and this may lead to the overvaluation of stocks.
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Among the pioneers of real business cycle theory is ________
A) Edward Prescott B) Robert Lucas C) Robert Solow D) Paul Volcker
A company that undertakes an activity so that it can "do well by doing good" is practicing
A) strategic corporate social responsibility. B) altruistic corporate social responsibility. C) profit sharing. D) the survivor principle.
A possible explanation for the persistence of the U.S. federal budget deficits is that: a. it is easier politically to increase government spending than to decrease taxes. b. it is easier politically to decrease government spending than to decrease taxes. c. it is easier politically to increase government spending than to increase taxes. d. the economy naturally tends toward recessions
e. the economy naturally tends toward full employment.
The rate at which aggregate supply changes to restore equilibrium at potential output depends crucially on:
a. how quickly planned investment spending adjusts to changes in population growth b. how quickly planned consumption spending adjusts to changes in the price level and nominal wages. c. how quickly technology changes to increase aggregate supply. d. whether the economy is experiencing a recessionary gap or an expansionary gap. e. how quickly real wages adjust to restore full employment in the labor market.